I want to join in welcoming you to our Privacy and Innovation Symposium.

I’d like to give special thanks to the superb
group of panelists who are joining us—many of whom have traveled across
the country to engage in this important dialogue.

And thank you to those government
officials—from the FTC, the State Department and the White House—who
are helping to lead the conversation.

We’ve invited you today to address a compelling
challenge: How do we on the one hand ensure that the Internet continues
to grow as a platform for innovation and commerce in the United States
and around the world, while at the same time protecting personal
privacy?

Every day, millions of Americans shop, sell,
bank, learn, talk and work online. As a society, we are more dependent
on the Internet than ever before.

As a result, the Internet is unparalleled in its ability to drive U.S. innovation and economic growth.

A new study was just released showing that
between 1998 and 2008, the number of domestic IT jobs grew by 26
percent, four times faster than U.S. employment as a whole. By 2018, IT
employment is expected to grow by another 22 percent.

The Internet is not only a source of tremendous past and future job growth. It is also a driver of global commerce.

According to private researchers, global online
transactions are currently estimated to total $10 trillion. Almost any
transaction you can think of can now be done online—from consumers
paying their utility bills and people buying books, movies and clothes,
to major corporations paying their vendors and selling to their
customers. And these same researchers predict that by 2020, global
online transactions will exceed $24 trillion.

This is transformational not only in terms of the size of e-commerce, but in the evolving way in which we use the Internet.

In the coming years, we will continue to see rapid growth in the diversity of applications, services and devices.

Single purpose “smart appliances” – like smart air conditioners – will connect to the smart grid.

A decade ago, going online meant accessing the Internet on a computer
in your home. Today, it also includes iPhones, portable games, and
interactive TVs.

Simply stated, the Internet is becoming the central nervous system of our information economy and society.

As powerful, exciting, and innovative as these developments are, they also bring with them new worries.

For example, through these devices and
applications, many companies are actively collecting personal
information and then using it to target products and services at
consumers.

This can make commerce more efficient and
companies more responsive to their customers needs. But it also demands
that we strike a balance where privacy implications are addressed.

If we are going to harness the full power of
the Internet, we need to establish norms and ground rules that promote
innovative uses of information while still respecting consumers’
legitimate privacy interests.

As we go about creating these privacy
guidelines, we need to be careful to avoid creating an overly
complicated economic and regulation environment.

We need to develop pro-innovation solutions to privacy concerns and to promote harmonization of such laws globally.

Given this challenging reality, we need to take a fresh look at the policy framework that underpins the Internet economy. . . .

. . . We need to ask, are there policy “nudges” that can assure privacy and simultaneously reduce impediments to e-commerce?

To answer this question, a few weeks ago I announced the formation of an Internet Policy Task Force.

The Task Force is made up of senior staff from across different parts of the Commerce Department.

It includes experts in standards, intellectual property, trade and privacy policy, technology, and Internet communications.

As many of you know, last month the Task Force released a formal request for public comment on data privacy issues.

The goal of that request for comments is twofold:

First, to determine the impact of domestic and international privacy frameworks on the pace of innovation; and

Second, to identify policies that will enhance privacy protection and trust on the Internet.

We are seeking a broad range of participation and welcome frank and honest comments.

The Task Force will analyze stakeholders’ views
and in the coming months prepare a report on Privacy and Innovation in
the Information Economy.

The dialogue launched here, and the research
conducted, will contribute to administration-wide policy positions and
global privacy strategy. So I thank you in advance for contributing
your thoughts.

To add a bit more context for today, I want to be clear on a fundamental point.

Too often, when this topic is raised by
government officials, it is perceived as adversarial; the government
versus business—the government looking to force the private sector to
do something.

The focus of our debate must be on how the government and the private sector can better address our shared responsibility.

I know, of course, that when it came to cyber
security over the last decade, many in the private sector felt the
conversation was largely one sided. . . and government was doing most
of the talking.

But almost a year ago, the president put out
the challenge that the U.S. government collaborate more closely with
industry to find solutions that ensure our security and promote our
prosperity. In the months since, we have made some good progress.
Together, we need to continue to step up our game.

Because the private sector owns and operates
the vast majority of the Internet’s infrastructure, and develops the
applications and services that move commerce through it, the government
is not in a position to prescribe engineering technology solutions.

I encourage the business community to identify
industry best practices in the handling of private information online
and to share what they have learned with the administration.

We are depending on the same input from
consumer groups and privacy advocates to ensure we formulate
well-rounded government policies.

In the early 1990s, the Internet was virtually
unknown to the general public. Its use was restricted to the government
and certain universities.

Twenty years later, the Internet today counts more than one billion users worldwide. It is no longer in start-up mode.

Given the Internet’s new scope and fundamental importance to our future, we need to get privacy policies right.

We need solutions that ensure privacy and promote prosperity.

We need a privacy framework for the 21st century.

So, our shared task is to pull the pieces
together into a coherent whole—to help ordinary citizens and Main
Street businesses understand that privacy protection is important, and
to work together to give Internet users confidence and trust in the
information superhighway.

As we collaborate to develop a new privacy framework, I want to thank you again for participating in this symposium.

I look forward to your ongoing engagement with us and other policymakers on this important issue.